In Mays v. Chase Manhattan Mortgage Corp., 2006 U.S.App. LEXIS 13478 (May 31, 2006), the plaintiff/debtor filed an adversary in the District Court wherein he asserted claims related to bankruptcy and insurance fraud. The events forming his causes of action occured during the course of his bankruptcy proceeding. The District Court dismissed on the grounds that it did not have subject matter jurisdiction because the Bankruptcy Court, pursuant to the standing referral order, had exclusive jurisdiction.
The Eleventh Circuit held the District COurts holding was in error. Pursuant to 11 U.S.C. §1334, the District Courts have original, but not exclusive, jurisdition over "related to" proceedings. Therefore, the District Court had subject matter jurisdiction over the adversary. However, the District Court also based its dismissal upon a finding that the plaintiff did not state a claim for relief. Because the plaintiff did not properly address this independent ground for dismissal, the District Court’s order was affirmed.